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Judgment
Since a common question of law is involved in these petitions, therefore, they are heard together and are being disposed of by this common order. For
the sake of convenience the facts are borrowed from Misc. Pet.No.1680/2017.
By this writ petition under Article 227 of the Constitution of India, the petitioner (Century Yarn / Denim Units of Century Textiles & Industries
Ltd.) is praying for setting aside of interim order dated 24.11.2017, passed by the M.P. Industrial Tribunal, Indore, in Reference No.41/ID Act/2017,
by which the learned Tribunal, in respect of order dated 2.11.2017, passed by the Deputy Labour Commissioner, Indore, has observed that since the
competent authority has already made reference on 13.10.2017 to the tribunal and on the date of reference, there was no strike, the learned Deputy
Labour Commissioner has wrongly exercised its power under Section 10(3) of the Industrial Disputes Act, 1947 (hereinafter referred as 'the I.D.
Act') and held that no prima facie case is made out under Sections 23 and 24 of the I.D. Act, as there is no privity of contract between first party and
second party No.2. The so called 'Business Transfer Agreement' between second party No.1 and second party No.2 prima facie has not been found
genuine and rejected the I.A.No.1 filed by the petitioner for interim relief in respect of illegal strike.
The few facts, which are necessary for disposal of this petition are as under :-
The petitioner is a company incorporated and registered under the Act No.VI of 1882 of Legislative Council of India and had set up two plants at
village Satrati, District Khargone, wherein it has been engaged in the business of manufacturing and sale of Yarn and Denim cloth.
The respondents No.1 to 4 are registered workers' Union operating in the petitioner company's industry and are represented through their
respective President / General Secretary. The respondent No.5 is also a company incorporate under the provisions of the Indian Companies Act, 1956,
which is engaged in the textile business, with whom the petitioner â€" company has entered into Business Transfer Agreement dated 22.8.2017
(Annexure P/2) for sale of yarn and denim units of the petitioner company situated at post â€" Satrati, District Khargone, on slump sale basis.
As per Business Transfer Agreement dated 22.8.2017, the respondent No.5 has purchased the textile unit in question from the petitioner. The
petitioner has transferred the manufacturing unit with entire assets and liabilities as per agreement Clause 7.4 to 7.6. The respondent No.5 has
undertaken to take over all the liabilities in respect of employees and workers employed in the plant. Clause 7.4, 7.5 and 7.6 are relevant which reads
as under :-
“7.4. On or from the Effective Date all the Employees shall be the employees of the Purchaser. The Purchaser agrees and acknowledges that the
employment made to the Employees on the Effective Date shall be on a continuity of service basis and that the terms and conditions of service
offered by the Purchaser to the Employees shall be no less favorable than the terms and conditions applicable to the Employees in their employment
by Seller. The Purchaser further agrees that the Purchaser will be liable to pay to every Employee, in the event of his retrenchment, compensation on
the basis that his service has been continuous and has not been interrupted by the transfer. The Purchaser shall intimate in writing, the continuation of
their services to all the employees of the yarn and Denim Undertaking.
7.5 The Seller shall transfer or assign the Employee Benefit Funds (provident fund and/or gratuity fund) up to the Effective Date to the Purchaser.
The amount of Gratuity Liability accruing as on the Effective Date shall be determined on the basis of actuarial valuation. The Seller shall contribute to
purchase the annuities in favour of the Purchaser for an amount equivalent to the liability arising from such actuarial valuation. The amount of
Provident Fund shall be transferred to the respective employee account opened by the Purchaser.
7.6 From and after the Effective Date, the Purchaser agrees to take over and be responsible for the fulfillment and maintenance of, and contributions
to, the Employee Benefit Funds, in accordance with applicable Law and the Seller shall not be liable for any liability with respect to such Employee
Benefit Funds from the Effective Date.
On 17.8.2017, no sooner the news of proposed transfer of the petitioner â€" unit to respondent No.5 spread, the workers of the petitioner â€
company were gathered at the plant and only when the officers of the petitioner company, to secure their safe exist from the factory premises, gave
written assurance inter-alia that as and when the petitioner â€" company will sell or lease out the units, the workers will be offered voluntary
retirement scheme or voluntary separation scheme as per the Government rules they were permitted to leave the factory premises in presence of
police and local administration. The petitioner company had filed necessary complaint with the District Collector as well as police on 21.8.2017.
According to the petitioner, when the news of business transfer agreement (Annexure P/2) broke out agitation again erupted and the matter was
raised by the respondent No.5 â€" (purchaser company) before the Deputy Labour Commissioner Industrial Relations, Indore. Taking the cognizance
made by the respondent No.5, the Deputy Labour Commissioner, Indore, summoned all the parties between the dispute and after prolonged
deliberations, when the learned Commissioner failed that the unions are not accepting to any of the proposal floated, the dispute cannot be resolved by
the discussion and, therefore, it was decided to make a reference to the M.P. Industrial Tribunal, Indore.
On 13.10.2017, the Deputy Labour Commissioner referred a limited question to the M.P. Industrial Tribunal under Section 10(1) of the I.D. Act.
Relevant part of the order reads as under :-
“D;k lsapqjh ;kuZ ,oa Msfue rFkk fo;fjV Xykscy fyfeVsM ds e/; fctusl VªkUlQj ,xzhesaV ds vuqlkj lsapqjh ;kuZ ,oa Msfue dk gLrkarj.k fo;fjV
Xykscy fyfeVsM esa fd;s tkus ij gLrkarj.k ds le; fu;ksftr Jfedksa dks LosfPNd lsok fuo`fRr ;kstuk vFkok LosfPNd lsizs'ku ;kstuk dk ykHk fn;s tkus
dk vkSfpR; gS ;fn gkW rks bldh D;k ;kstuk gksuh pkfg, ,oa bl lca/k esa izca/ku dks D;k funsZ'k fn;s tkus pkfg, \â€
  From the perusal of the aforesaid, it is clear that the learned Deputy Labour Commissioner, referred the issue whether under the Business
Transfer Agreement between the petitioner â€" company and the respondent No.5 company, at the time of transfer of Century Yarn and denim
divisions to Wearit Global Limited is it desirable to give the benefit of Voluntary Retirement Scheme or Voluntary Separation Scheme to the workers
employed at the time of transfer, and if yes, what should be the scheme and what directions must be given to the Management in this regard ?.
On 17.10.2017, when sign board of the petitioner was replaced by the sign board of respondent No.5, the employees and workmen immediately
came out of factory and they have stopped working. On 24.10.2017, the petitioner company filed an application before the M.P. Industrial Tribunal
vide (I.A.No.1) for interim relief in respect of illegal strike resorted by respondents No.1 to 4 â€" Union on the ground that as per Business Transfer
Agreement with the respondent No.5, the petitioner is transferring the manufacturing unit with entire assets and liabilities to the respondent No.5. As
per para 7.4 to 7.6, of Business Transfer Agreement, the respondent No.5 has undertaken to take over all the liabilities in respect of employees and
workmen employed in the plant. The respondent No.5 undertaken over the services of the employees and workmen and, therefore, the question of
making any payment to them does not arise as a reference is already made to the Tribunal. The Union of workers have no authority and right to resort
to strike. It is also stated that as per Section 23 of the I.D. Act, no workman who is employee in a industrial establishment shall go on strike in breach
of contract during the pendency of the proceeding before the M.P. Industrial Tribunal and as per Section 24 of the I.D. Act, a strike or lock out shall
be illegal, if it is declared in contravention of Section 23 or 22, of the I.D. Act. It is also pleaded by the petitioner that if such strike is allowed to be
resorted to or allowed to be continued, it is bound to create a cats-strophe and prayed to issue ad-interim order to prohibit the respondents No.1 to 5
â€" Union for continuing with strike with immediate effect and to resort all workmen and employee working in petitioner from continuing with strike
and to restore the normalcy.
As per reply, the Business Transfer Agreement has been executed without taking any consent from the employee and workmen of the petitioner.
It is also pleaded that no reference regarding question of strike has been referred to the Tribunal and the learned Tribunal has no jurisdiction to hear
and decide the question of strike because this question has not been referred for adjudication. An application was filed by the petitioner before the
Deputy Labour Commissioner on 1.11.2017 and consequently, the Deputy Labour Commissioner has passed prohibitory order on 2.11.2017 regarding
strike. With the aforesaid, the employees and union prays for rejection of the application.
The bonafide and genuineness of the Business Transfer Agreement was questioned before the Tribunal on the ground that the same is not genuine
because it is not registered and required stamp duty has not been paid. No proper information has been given to its employees and workmen regarding
the aforesaid Business Transfer Agreement. The Business Transfer Agreement shows that the consideration of sale is only for
Rs.2,51,00,000/(Rs.Two Crores Fifty One Lac only) and that too for huge property like machinery, land and structure, which shows that it is only
fictitious and sham document has been prepared to take advantage of the provisions of Section 25-FF of the I.D. Act. The main dispute between the
parties is regarding transfer of ownership and members of respondents No.1 to 4 Union, who are still ready to work with petitioner and they cannot be
compelled to work with the respondent No.5.
The stand of the petitioner before the Industrial Tribunal was that the Business Transfer Agreement is valid and genuine document. The learned
Tribunal after appreciating the arguments of the learned counsel for the parties came to the conclusion that there is a prima facie evidence on record
that petitioner and the respondent No.5 have entered into a sham transaction and they are trying to create document wherein they incorporated the
proviso of Section 25-FF of I.D. Act. The Business Transfer Agreement is not a genuine document and in these circumstances, if employee and
workmen are not ready to work with respondent No.5, they cannot be compelled to work with them because there was no privity with the respondent
No.5 to work with them and if they are protesting against the petitioner, it would be said they are resorting strike and it is also observed that the
Deputy Labour Commissioner, Indore, has already made reference on 13.10.2017 to the Tribunal and on the date of reference, there was no so called
strike. The Deputy Labour Commissioner has wrongly exercised its powers under Section 10(3) of I.D. Act and allowed the prayer of Union by
rejecting the application of the petitioner.
Para 14 to 24 of order dated 24.11.2017 passed by the M.P. Industrial Tribunal, Indore is relevant which reads as under :-
“14. First of all, it is necessary to consider that prima facie case for grant of ad-interim relief, as prayed by second party No.2, is made out ? It is
well settled principle of law that in case of a genuine transfer of business, workers employed under vendor are entitled to retrenchment compensation
only under section 25-FF of the I.D. Act. Long back Hon'ble the Supreme Court in Gurmail Singh & Ors. V/s. State of Punjab & Ors., 1991-II-LLJ-
76 observed as under :-
“The Supreme Court was dealing with a case of genuine trans- fer between two parties--a predecessor and a successor--at arms' length where
the principles of the law of contracts clearly held the field. The employees of the predecessor had no privity of contract with the successor and could
make no claims against him. The industrial law, however, safeguarded his interests by inserting S. 25FF and giving him a right to compensation against
his former employer on the basis of a notional retrenchment except in cases where the successor, under the contract of transfer itself, adequately
safeguard- ed them by assuring them of continuity of service. and of employment terms and conditions. In the result. he can get compensation or
continuity but not both. The present case before us raises an allied, but sometimes more important issues. as to whether there cannot be situations in
which the court or industrial adjudicator, should, in the interests of justice, fairplay and industrial peace, hold the employee entitled to continuity with the
successor without being compelled to be satisfied with compensation from the predecessor. The Su- preme Court itself has visualised such a case and
made it clear that if a transfer is fictitious or benami S. 25FF has no application at all. Of course, in such a case, ""there has been no change of
ownership or management and despite an apparent transfer, the transferor employer continues to be the real employer and there has to be continuity
of service under the same terms and conditions of service as before and there can be no question of compensation.â€
Cases on which learned counsel for second party No.1 has placed reliance have been perused. In Anakapalle Co-operartive Agricultural and
Industrial Society Ltd.(supra) Hon'ble the Supreme Court held that there was a bonafide transfer and employees were already paid compensation by
transferee, therefore they were not succeeded to claim reinstatement in the transferee company.
Facts of Bhola Nath Mukherjee's case (supra) were squarely different from the facts of the case in hand.
Interpretation of Section 25-FF of the I.D. Act was made in Rashtriya Mill Mazdoor Sangh & Ors.'s case (supra) and Hon'ble the Supreme Court
held in that case that contract of employment has not ended on transfer of business.
Ration of All India ITDC Workers Union and Ors.'s (supra) case is not applicable to the facts of the case in hand.
In Workmen of Mattur Beardsell Ltd. and Arn. Workmen of Mattur Beardsell Ltd. and Anr's case (supra) there was genuine transfer and
employees were failed to made averment as well as evidence before the court to show that there was fraud and transaction was sham.
Learned counsel appearing on behalf of second party has cited afore mentioned cases with assumption that there is a bonafide transfer between
second party No.1 and second party No.2. But mere perusal of reference order, it is clear that second party no.1 and second party No.2 did not
produce the whole Business Transfer Agreement before the Deputy Labour Commissioner, Indore and second party no.1 primarily filed only three
pages. Second party No.1 also did not file whole Business Transfer Agreement with I.A.No.1. After direction by this Tribunal second party No.1 has
produced the whole Business Transfer Agreement before this Tribunal. It is their contention that since requirement of Section 25FF of the I.D. Act
has already been incorporated in Clause 7.4 of the Business Transfer Agreement , therefore, there was no need to file whole document. But as
mentioned hereinabove, to ascertain whether transaction between second party No.1 and second party No.2 is genuinen or fictitious?, we have to
thoroughly look into the substances of the document and nor form thereof.
When we go through the whole document, we can easily find out that the same is written on inadequate stamps as well as the so-called document
is not registered. Further whole industry of second party No.1 is said to have been sold for consideration of Rs.2,51,00,000/- only. It is true that the
Business Transfer Agreement has been made on the basis of 'as is where is' for lump sum consideration as a going concern with assets and
liabilities without doubt and as per the term 7.4, it would be effective on or from the effective date ie., 22.8.2017 and on this date second party No.1
shall be deemed to be transferred and vested in purchaser ie., second party No.2. When we go through the attached schedules regarding immovable
properties and machineries, it is found that second party no.1 has possessed land about 82.93 acres on which different buildings and two factories are
situated and huge machineries are to be transferred on the effective date and that is only for consideration of Rs.2,51,00,000/-. These facts and
circumstances of the case create doubt on genuineness and bonafide of aforesaid transaction and Section 25-FF and I.D. Act is only applicable to
genuine and bonafide transaction between two companies. Second party No.1 has further failed to demonstrate that it has intimated in writing to
employees regarding their continuation of service.
Further first party No.2 has filed a copy of compromise/ promise dated 17.8.2017, arrived at between second party no.1 Century Yarn/Denim and
employees and workmen before Administrative Officer, Police Officer and Labour Officer. This document has not been denied or contradicted by
second party No.1 In this document first party No.1 has made a specific promise that in the event of sale or lease agreement with other compa,y, all
employees and workmen would be entitled to V.R.S. as per government rules. In that compromise/promise firsty party No.1 has further assuredÂ
that if it entered into sale or lease agreement with other company, all employees and Unions would be apprised for the same, but second party no.1 did
not adhere to the aforesaid terms of compromise/promise and behind beack of employees and Unions, it entered into the so-called Business Transfer
Agreement on 22.8.2017 with second party No.2 Certainly first party (all employees) have felt cheated. It is on record that first party employees and
workmen were sincerely working until sign board of second party No.1 Century Yarn/ Denim was not replaced. In these circumstances, it is a case
wherein second party no.1 Century yarn/Denim has resiled from its compromise/promise with its employees and workmen and therefore, employees
and workmen are agitating for their right. In this case, there is prima facie evidence on record that second party Nos.1 and 2 have entered into a sham
transaction and they are trying to create a document wherein they have incorporated all three conditions of the Proviso of Section 25-FF of the I.D.
Act. But after minutely examination of the Business Transfer Agreement, it is found that this document itself is not a genuine document and second
party Nos. 1 & 2 have devised a mechanism to slowly shut down the industry. In these circumstances, if employees and workmen are not ready to
work with second party No.2, they cannot be compelled to work with them because there is no privity of contract with second party No.2 and if they
are protesting against second party No.1, they cannot be said to be resorting strike.
As far as prohibitory order passed by the Deputy Labour Commissioner, Indore on 2.11.2017, is concerned, since the competent authority has
already made reference on 13.10.2017 on this Tribunal and on the date of reference, there was no so-called strike, then the Deputy Labour
Commissioner has wrongly exercised its powers under Section 10(3) of the I.D. Act. Therefore, I am of view that no prima facie case is made out
under Sections 23 and 24 of the I.D. Act as there is no privity of contract between first party and second party no.2. The so called Business Transfer
Agreement between second party No.1 and second party No.2 prima facie has not been found genuine. Further employees and workmen are still
ready to work with second party No.1. They are only agitating due to dubious conduct of second party no.1 in regard to compromise/promise dated
17.8.2017 made with them.
In view of the above facts and circumstances, I.A.No.1, filed by second party for interim relief in respect of illegal strike, is liable to be rejected
and is hereby rejected. Now reference case be listed on 13.12.2017 for filing statement of claim by first party.â€
Learned Senior counsel for the petitioner has submitted that the learned Tribunal failed to see that the only issue, which was adopted by the
petitioner â€" company was only to seek restraining directions from the Tribunal against the workmen, who had gone on illegal strike and continuing to
do so, despite directions from the learned Deputy Labour Commissioner and there was no occasion to him to arrive at the finding that the Business
Transfer Agreement between the petitioner and the respondent No.5 is a sham transaction. In respect of alleged assurance dated 17.8.2017, the
contention of the learned Senior counsel is that the said assurance was not voluntarily given by the Officer of the petitioner â€" company and
therefore not binding and enforceable, as they were house arrested and were forced to give such an assurance, which is not legal and valid consent.
In respect of sale of huge property of the petitioner â€" company to the respondent No.5 for consideration of Rs.2.51 Crores, the stand of the
petitioner â€" company that both the units were making a loss of Rs.36.00 Crores per annum and looking to the fact that the respondent No.5 was
taking over the assets, but also all the liabilities attached to the units, including but not limited to the liability of the staff members and the workmen.
He has drawn our attention to the decision of the Apex Court in the case of Pottery Mazdoor Panchayat V/s. Perfect Pottery Co. Ltd & Anr.,
1979 (3) SCC 762 and submitted that Tribunal has no jurisdiction to go behind the reference and inquire into the question regarding the validity of the
Business Transfer Agreement and whether the strike was illegal or not. The reference being limited to the narrow question of deciding the desirability
of the VRS or VSS Scheme for the workmen of the petitioner â€" company and neither he had any occasion nor authority to decide the validity of
Business Transfer Agreement dated 22.8.2017. He has also placed reliance on the decision of the Apex Court in the case of Mettur Beardsell Ltd.
V/s. Workmen & Anr., 2006 (9) SCC 488, the Apex Court has observed that there is nothing in the wording of Section 25-FF, even remotely to
suggest that consent is a pre requisite for transfer or employeed and also, a sham transfer is one which always intended and devised to be a fraud
of all the provisions of the concerned statute in relation to which it is alleged to be a fraud. Â
In the case of Oshiar Prasad & Others V/s. Employers in Relation to Management of Sudamdih Coal Washery of M/s Bharat Coking Coal
Limited, Dhanbad, Jharkhand, reported as 2015 (4) SCC 71, the Apex Court has held that the appropriate government is empower to make a
reference under 10 of the I.D. Act, only when “industrial dispute exists†or “is apprehended between the partiesâ€. The Supreme Court held
that the Tribunal while answering the reference has to confine its enquiry to question(s) referred and has no jurisdiction to travel beyond or/and terms
of reference. He has also drawn our attention to the provisions of Section 10(3), 22, 23 and 24 of the I.D. Act and placing reliance on the decision of
Syndicate bank & Another V/s. K. Umesh Nayak reported as (1994) 5 SCC 572 and submitted that whether the strike was legal or illegal and justify
or unjustify, were issues which fell for decision within the exclusive domain of the industrial adjudicator under the Act and it was not primarily for the
Tribunal to give its finding on the said issue.
He placed reliance to the decision of Balwant Rai Saluja & Anr. V/s. AIR India Ltd & Ors. reported as 2014 (9) SCC 407 and submitted that the
corporate veil can be pierced only if there is some impropriety and the impropriety in question must be linked to the use of the company structure to
avoid or conceal liability. The Hon'ble Supreme Court while discussing the doctrine of corporate veil has held the following in para 74 which reads as
under :-
“74. Thus, on relying upon the aforesaid decisions, the doctrine of piercing the veil allows the Court to disregard the separate legal personality of a
company and impose liability upon the persons exercising real control over the said company. However, this principle has been and should be applied
in a restrictive manner, that is, only in scenarios wherein it is evident that the company was a mere camouflage or sham deliberately created by the
persons exercising control over the said company for the purpose of avoiding liability. The intent of piercing the veil must be such that would seek to
remedy a wrong done by the persons controlling the company. The application would thus depend upon the peculiar facts and circumstances of each
case.â€
As per Business Transfer Agreement, both the yarn and denim undertaking has been transferred to the respondent No.5 (purchaser) for a
purchase consideration of Rs.2.51 Crores only, which includes 82.93 acres of land, main factory building, century yarn and century denim, cotton
waste godown, plant and machinery as per schedule 3 and 4. The total value of the assets is around 426.78 Crores. No stamp duty has been paid nor
Business Transfer Agreement is property registered. There is violation of Clause 7.4 of agreement as no proper intimation was given to the employees
regarding continuance of service as yet. On 20.12.2017 (Annexure R/2/3), a letter was issued to the management of century yarn and denim from the
office of Labour Officer, Khargone, with respect to the illegal deduction of the salaries of the workmen. Further the reminder of the said letter was
issued on 11.1.2018. The Office of District Registrar, Khargone, also issued the letter wherein it is specifically mentioned that there is no registration
of Business Transfer Agreement with respect to the sale of the century yarn and denim in the Office of District Registrar, Khargone. In recent past,
the petitioner forced about 300 employees to leave the job, which administered the mala fides of the petitioner â€" company and intentions that they
are planning to reduce the strength of the employees or shut down the unit, which leads to unemployment and violation of rights of labourers. The
Business Transfer Agreement is contrary to the compromise dated 17.8.2017 made by the second party No.1 to the employees on the point of
voluntary retirement scheme. The terms of the compromise arrived between the parties as is evident from letter dated 17.8.2017 reads as under :-
**vkt fnukad 17-08-2017 dks etnwj ,oa deZpkjh rFkk izca/ku ds chp fuEukuqlkj lgefr cuhA
1& ;g gS fd fcMyk xzqi dh dEiuh lspqjh ;ku ,oa Msfue dks lqpk: :i ls fujarj pykus dks iz;kl fd;k tkosxkA
2& fdlh Hkh dkj.k ls dEiuh fcdzh ;k yht gsrq vuqca/k djrh gS rks lHkh dkexkjksa ,oa deZpkfj;ksa dks 'kkldh; fu;ekuqlkj oh-vkj-,l- fn;k tkosxkA
3& ;fn fcØh ;k yht vuqca/k gksrk gS rks dEiuh }kjk lHkh ;qfu;uksa ,oa deZpkfj;ksa dks voxr djk;k tkosxkA
4& tks Hkh lgefr cusxh mldk fcMyk izca/ku lHkh dkexkjksa ,oa LVkWQ ij ykxw djok;k tkosxkA
 5& 'kfuokj dks cnyh Jfedks dks cnyh ds fu;eksa ds vuqlkj mifLFkfr ,oa osru dk Hkqxrku fd;k tkosxkA
 6& iwoZ eas tks Hkh Jfed ukSdjh NksMdj x, gS mudks vc u;h 'krksZ ds vuqlkj ykHk fn;k tkuk laHko ugh gSA
7& mijksDr 'krksZ dk fu/kkZj.k iz'kklfud iqfyl ,oa Jeinkf/kdkjh ds mifLFkfr esa fd;k x;kA**
It is also well settled that Section 25-FF of the Industrial Disputes Act is only applicable to genuine and bona fide transaction between the two
companies. The estimated cost of the properties (movable and immovable) involved in this Business Transfer Agreement is sum of Rs.426.78 Crores.
The concept of corporate entity was evolved to encourage and promote trade and commerce but not to commit illegalities or to defend people.
Where, therefore, the corporate character is employed for the purpose of committing illegality or for defrauding others, the Court would ignore the
corporate character and will look at the reality behind the corporate veil so as to enable it to pass appropriate orders to do justice between the parties
concerned. Where the protection of public interests is of paramount importance or where the company has been formed to evade obligations imposed
by the law"", the court will disregard the corporate veil.
In the present case, the petitioner and the respondent No.5 have executed a Business Transfer Agreement for some important purpose. The said
documents is not registered before the Registrar nor proper valuation of the movable and immovable properties of yarn and denim has been made nor
stamp duty was paid. The said Business Transfer Agreement has been executed for committing illegality and / or to defraud the employees and thus,
we are of the view that the learned Senior counsel of the Union has rightly said that the court will disregard the corporate veil and treat the company
as a mere sham.
Under Article 227, this court vested with the powers of superintendence and/or judicial revision, even in matters where no revision or appeal lies to
the High Court. The Apex Court in the case of Jai Singh & Others V/s. Municipal Corporation of Delhi & Anr. reported as 2010 (9) SCC 385 has
observed that the exercise of jurisdiction must be within the well recognized constraints. It cannot be exercised like a `bull in a china shop', to correct
all errors of judgment of a court, or tribunal, acting within the limits of its jurisdiction. This correctional jurisdiction can be exercised in cases where
orders have been passed in grave dereliction of duty or in flagrant abuse of fundamental principles of law or justice. This court cannot likely or lightly
or liberally act as an appellate court and re-appreciate the evidence nor it can substitute its own conclusions for the conclusions reached by the courts
below or the statutory/quasi judicial tribunals. The power to re-appreciate evidence would only be justified in rare and exceptional situations where
grave injustice would be done unless the High Court interferes. The exercise of such discretionary power would depend on the peculiar facts of each
case, with the sole objective of ensuring that there is no miscarriage of justice.
This court in exercise of its supervisory jurisdiction can only look into the dispute that was raised before the industrial court and examine as to
whether the industrial dispute has committed any patent error, which is manifest and apparent from the face of the record, which is resulted in gross
injustice or failure of justice. The scope of supervisory jurisdiction is limited to keep subordinate judicial authority or tribunal within the bound of their
jurisdiction. Permissability of interference in interlocutory order passed by the court is required only if the order impugned can be termed as erroneous
and illegal to such an extent that if interference is not made at that particular stage, it will cause serious harm, injustice and prejudice to the aggrieved
person, which cannot be corrected at later stage. It is also not permissible to this court on a petition filed under Article 227 to review or reweigh the
evidence upon which the purport to have passed the order or to correct error of law in the decision.
Section 25-FF deals with consequence flowing from genuine transfer of undertaking and does not create any vested right in the employer to
transfer the undertaking or to avoid paying compensation by requiring the transferee to extend the benefit set out in the proviso to Section 25-FF of the
Act. Where a transfer is fictitious or 'Benami' Section 25-FF has no application at all. The provision of Section 25-FF would not apply where there is
no transfer of ownership or management to the undertaking either by agreement or by operation of law.
In the case in hand, under the provision of Registration Act, the document in question is compulsory registrable, but is not registered, nor Business
Transfer Agreement was duly stamped and is therefore, invalid, unenforceable and not binding. The said document was compulsorily registrable under
Section 17 of the Registration Act. The same will not affect the immovable property comprised therein in any manner. It will not be also received of
evidence of any transaction affecting such property.
Considering the aforesaid, the learned tribunal while deciding the Interlocutory Application No.1 has observed that it create doubt on genuineness
and bonafide of the aforesaid transaction and Section 25-FF of the I.D. is only applicable to genuine and bonafide transaction between the two
companies. We are of the view that the learned tribunal has rightly rejected the prayer for grant of stay.
We are, therefore, not inclined to interfere with the impugned interim order passed by the learned tribunal. No case is made out to set aside the
order in exercise of the supervisory jurisdiction under Article 227 of the Constitution of India.
In the result, the writ petition has no merit and is, accordingly, dismissed, but without any order as to costs.
A copy of this order be kept in connected W.P.No.1682 of 2017, for its compliance.